Air France-KLM reports loss as fuel costs rise

Airline group Air France-KLM has reported a loss for the first three months of the year, following higher fuel costs and a drop in cargo traffic.

Its first-quarter net loss was 368m euros ($483m;£299m), almost the same as a year before, although revenue rose 6% to 5.6bn euros.

Higher workforce costs because of a 2011 pay rise also affected profits.

"As expected, the first quarter was difficult in spite of an improvement in activity in March," the firm said.

Last year, Air France-KLM launched a plan to reduce costs by 10% and cut debt, and it said the effects of that plan should be seen in the second half of the current financial year.

Passenger traffic was up 5.5% and revenue in that business rose 8.8%.

Meanwhile operating losses grew to 597m euros from 403m a year ago.

Source & Image : BBC